Geely Starts Selling Panda Cars Online Using Group-Buying Plan

Last week, Geely unveiled its first Englon brand car, the SC5-RV model in the mid-priced segment.
SHANGHAI (AdAgeChina.com) -- Chinese consumers have already turned to the internet to research car brands and manufacturers, find dealership locations and read reviews on auto-themed blog forums, but they can now go online to buy cars too.

Zhejiang Geely Holding Group Co., Volvo Car Corp.'s new owner, is the latest marketer, and the first car manufacturer, to launch a regular online presence on Alibaba Corp.'s Taobao Mall, a business-to-consumer online shopping platform that has evolved into an e-commerce superstore.

Launched in April 2008 by Alibaba, which is which is 40% owned by Yahoo, Taobao Mall currently offers 30,000 multinational and local brands, making it the largest B2C online marketplace in Asia. China is the world's largest internet market with 420 million web users in June 2010, according to the China Internet Network Information Center.

Geely, which first announced its plans to sell cars online six months ago, said it will start selling two of its Gleagle Panda models on Taobao starting Dec. 22, 2010. initially through a group-buying system. The Taobao offering includes a two-colored Panda specially created for online customers. The Panda is a small car popular among young white-collar office workers.

Group buys, in which large numbers of consumers team up to negotiate for a better price, have become popular in China. An item must be bought in a minimum quantity or dollar amount, otherwise, the seller will not allow the purchase. Mercedes-Benz used a similar group-buying system for one-off sales promotion to sell 205 cars in China last September.

Customers can search for information, place orders, and pay a RMB 288 ($43.23) deposit on the store's website, then go to dealerships to do test drives, pick up cars, and pay the remainder of the purchase price. Geely has plans to offer certain car models exclusively for sale online in the future.

Geely, a privately owned company, has become one of the star players in China's domestic car market. Its sales rose 24.5% year-on-year and 10.3% month-on-month to 44,155 units in November 2010. Last week, Geely unveiled its first Englon brand car, the SC5-RV model in the mid-priced segment.

The Englon falls between two existing Geely brands, the entry-level Gleagle and the Emgrand, which is aimed at affluent car buyers. Geely expects to sell 50,000 SC5-RVs in the first year, 80,000 in the second year, and more than 100,000 in its third year on the market. A four-door version of the model will be launched next year.

Geely's expansion plans aren't only about the Chinese market. The company is also looking for export opportunities. Automakers in China exported 223,900 passenger vehicles in the first ten months of this year, a 107% increase from a year ago, according to the China Association of Automobile Manufacturers. The cars went mainly to Algeria, Vietnam, Syria, Russia, Egypt, Bangladesh, Iran, Chile, Brazil and Iraq.